In response to RBI order, Bajaj Finance trades down on stopping EMI cards

By: Pune Pulse

November 21, 2023

Pune : Following an RBI order on November 15, the lender temporarily stopped issuing member ID cards to customers, which caused shares of Bajaj Finance to decline by 0.7 per cent in morning trade on November 20. The stock was trading at Rs 7,171.30 at 10:30 a.m.

As per information, on a November 17 regulatory filing, Bajaj Finance stated that it would continue to provide financing to both new and existing customers at dealer stores in the regular course of business and that it had temporarily halted the issuance of existing member identification (EMI) cards to new customers until the RBI’s observations of deficiencies were addressed to their satisfaction. It stated that there would be no appreciable financial impact from the decision.

Several analysts have rated the stock as ‘overweight,’ with a share target price of Rs 10,300. Analysts at Bank of America have issued a ‘buy’ call on the stock, with a target price of Rs 8,845 per share. The report states that the business should anticipate a short-term impact on fee income.

The Reserve Bank of India (RBI) announced on November 17 that non-banking financial corporations (NBFCs) would now have a 125 percent risk weight on their consumer credit exposure, up from 100 per cent previously.

Shreyas Vange